Professional Documents
Culture Documents
Global
International
North America
North America
Local
United Kingdom Australia Korea
Yips Framework
Market drivers
Cost drivers
Government drivers
Competitive drivers
Cost drivers
global scale economies steep experience curve sourcing efficiencies favorable logistics differences in country costs high product development costs rapidly changing technology
Government drivers
favorable trade policies compatible technical standards common marketing regulations government owned competitors and customers host government concerns
Competitive drivers
high exports and imports competitors from different continents interdependence of countries competitors globalized
Global Differentiation
Create a superior product or change
customer perception of the product in order to raise price on a global scale Often the basis of this strategy is a strong brand name
Global Segmentation
Global version of a focused strategy Can be either be global cost leadership or
global differentiation Targets a single segment on a worldwide basis
Protected Markets
Focusing on competing in countries where
that particular government protects or favors the business
National Responsiveness
Focuses on adapting strategy to each local
market
substantial control over its country operations in an effort to minimize redundancy, and achieve maximum efficiency, learning, and integration worldwide. In the extreme case, global strategy asks why not make the same thing, the same way, everywhere? It favors greater central coordination and control than multi-domestic strategy, with various product or business managers having worldwide responsibility. Activities such as R&D and manufacturing are centralized at headquarters, and management tends to view the world as one large marketplace.
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decision-making is decentralized to the level of individual geographic regions whose managers are responsible for operations within their region. Firms that market relatively uniform goods across entire regions with little adaptation requirements tend to organize their international operations geographically. The structure is decentralized because management of international operations is largely delegated to the regional headquarters responsible for each geographic area.
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South America, North America, Europe, Asia, and so on. The firm treats all geographical locations, including the domestic market, as equals. All areas work in unison toward a common global strategic vision. Assets, including capital, are distributed with the intent of optimal return on corporate goals not area goals. Geographic area divisions usually manufacture and market locally-appropriate goods within their own areas. Firms that use the geographic area approach are often in mature industries with narrow product lines, such as those in the pharmaceutical, food, automotive, cosmetics, and beverage industries.
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area, product, and functional structures in an attempt to leverage the benefits of a purely global strategy and maximize global organizational learning, while remaining responsive to local needs. It is an attempt to capture the benefits of the geographic area, product, and functional organization structures simultaneously, while minimizing their shortcomings.
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capability to respond to worldwide opportunities Increases opportunities for cross-national learning and cross-fertilization of the firms knowledge base among all the subsidiaries Creates economies of scale, which results in lower operational costs. Can also improve the quality of products and processes -- primarily by simplifying manufacturing and other processes. High-quality products promote global brand recognition and give rise to customer preference and efficient international marketing programs.
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